to become a copper producer

Burdekin Pacific Limited ASX Announcement 31 August 2005 Burdekin Pacific Limited A.C.N. 059 326 519
Level 2, BGC Centre 28 The Esplanade Perth WA 6000
Phone: +61 8 9322 6045 Fax: +61 8 9481 5557

MEDIA RELEASE WEDNESDAY, 31 AUGUST 2005

BURDEKIN TO DIVERSIFY AS A COPPER PRODUCER THROUGH ACQUISITION OF NT PROJECT PROPOSED ACQUISITION OF REDBANK PROJECT, NAME CHANGE, CAPITAL RAISING

Minerals explorer Burdekin Pacific Limited (ASX: BKS) is set to expand into the copper business after today announcing the proposed acquisition of the Redbank Copper Project in the Northern Territory McArthur River Basin.
The acquisition will give Burdekin immediate production and cash flow, a strong new growth focus, and a diversified commodity portfolio.
The Perth-based Group said today (Wednesday) it had reached agreement to purchase 100% of the issued capital of Redbank Mines Limited (RBM), whose main asset is a contractual right to purchase 100% of the assets comprising the Redbank Copper Project. The Project is located some 40km from the Queensland Border to the north-west of the Mt Isa Inlier which contains a number of world-class base metal mines.
Burdekin also announced its intention to seek shareholder approval to change its name to Redbank Mines Limited to reflect its new direction, a proposed $4 million capital raising to underpin exploration & development activities, and its intention to invite two new directors, James Searle and Michael Kitney to join its Board.

The Redbank Project includes an inventory of JORC classified Indicated and Inferred Resources of 4.2 million tonnes at 1.5% copper for 64,910 tonnes of contained copper (143.2 million lbs), granted mining and exploration licences and mine infrastructure, the opportunity to generate immediate cash flow through the treatment of existing high-grade (5%+ Cu) copper stockpiles and the development of near-surface oxide resources to produce high-grade copper intermediate products for niche markets. Existing mine infrastructure and operating plant and equipment currently utilised to treat oxide stockpiles are included in the purchase, enabling the operation to be acquired effectively as a going concern.

Burdekin’s Chairman, Sydney-based Mr Kim McGrath, said the proposed acquisition represented a major new development for the Company, providing it with a source of immediate cash flow and the diversification of its advanced exploration portfolio to a second commodity, alongside its 100%-owned Mt Kasi Gold Project in Fiji. The consideration for the proposed acquisition is $3.9 million, comprising $750,000 in cash and $3.15 million in shares, plus 300 “Performance Class” shares, to be issued to the shareholders of Redbank Mines Limited. The acquisition is subject to shareholder approval, Burdekin raising a minimum of $4.0 million for project development, and other normal legal and regulatory requirements. The Company also announced a consolidation of its share capital,
contingent upon all of the other transaction related resolutions being passed by shareholders at a forthcoming meeting in October to be held to consider the acquisition.

Mr McGrath said the Redbank Project offered a low-risk entry to the copper business, with the opportunity to enter production in the short-term, utilising the cash flow to self-fund a broader exploration program targeting both additional oxide reserves and deeper sulphide reserves to justify refurbishing the existing flotation plant on site to produce copper concentrate as a second revenue stream. Burdekin’s Managing Director and CEO, Mr Gino Vitale said “the project has several facets including cash flow from the treatment of high-grade stockpiles, immediate oxide drilling targets, and a highly prospective tenement package including numerous sulphide exploration prospects.”
Well-credentialed senior international mining executives, including Dr James Searle and Mr Michael Kitney, will be invited to join the Burdekin board on completion of the transaction. “Dr Searle, an experienced geologist and mining company executive, most recently CEO of Nordic-focused gold producer Dragon Mining NL, will be invited to join the Board in an executive capacity with operational oversight for project development and exploration. Mr Michael Kitney, an experienced process engineer and metallurgist, will be invited to join as a non-executive director and has
also agreed to be available as a technical consultant to the Company as required”, Mr Vitale said.
Burdekin’s immediate focus will be to expand the existing pilot-scale treatment of high-grade copper stockpiles at Redbank to a small commercial scale of copper cement production and review options to produce other products such as copper sulphate. Copper cement is used as a feedstock by chemical manufacturers and copper sulphate by end-users such as base metal producers in the mining industry and the agricultural sector – with demand for these intermediate and end-use products currently running at very high levels.

A preliminary process review conducted by Bemex Corporation Pty Ltd estimated that cash operating costs for the treatment of the existing stockpiles to produce copper cement would be well below A$1.00 per pound of contained metal compared with the recent copper price of above A$2.00/lb.

The feasibility of producing a higher-value copper sulphate product from the treatment of oxide material for sale to the domestic Australian market will be reviewed, in parallel with an intensive 2-year exploration program including drilling of the Sandy Flat mine environs, the Bluff and Punchbowl deposits, as well as numerous other priority targets in the immediate vicinity.
“There are significant mineralised intersections outside the estimated resources area and there is excellent exploration upside for large tonnage, low-grade copper mineralization and potential for additional near surface oxides,” Mr Vitale said. “Deeper sulphide targets will also be tested as part of a phased two year exploration program at an estimated cost of approximately $1.3 million, with our objective being to identify sufficient copper sulphide mineralisation to justify refurbishing the existing flotation plant to produce copper concentrate as a second revenue stream.” (for significant
intersections, refer today’s ASX announcement at page 11).

Burdekin will retain a 100% interest in the Mt Kasi gold project in Fiji, where consultants RSG Global recently estimated a revised mineral resource for the main deposit at Mineral Hill of 3.4 million tonnes grading 2.2g/t gold in the Indicated and Inferred categories for 205,000oz of contained gold which, together with stockpiles and other near mine site resources, brings the project’s total resource inventory to 240,000oz. The Company believes Mt Kasi has excellent exploration upside and plans to complete a 5,000 metre drilling program to test near-mine and regional targets as soon as practicable as part of the next stage of the Project’s development.

Redbank Project History
The Redbank area is named after the original mine on Redbank Creek discovered and operated by William Masterton in 1916. Small scale production from 1916 until 1957 yielded 1,200 imperial tons of high grade ore. Numerous companies investigated the area between the 1940s and the early 1990s, including a consortium led by Newmont Australia, Triako Mines NL, Harbourside and CRA Exploration.
No further production occurred until a small open cut operation was established by the present owners of the project at the Sandy Flat deposit in the mid 1990s. Production from Sandy Flat has been reported as 170,000 tonnes at 4.6% copper, plus 54,000 tonnes at 6.0% copper in stockpiles left at site together with mine and processing infrastructure.
Released by: Jan Hope/Nicholas Read Jan Hope & Partners Telephone: (+61-8) 9388-1474


In my opinion, 240,000 ounces of gold at Mt Kasi with more drilling to come shows further good upside potential and now
4,200,000 tonnes of 1.5% copper which equates to approx 143.2 million pounds of contained copper.

Isn't the copper price around US$1.76 - (AUS approx $2.30 per pound)?
Cost to produce copper per pound - well below AUS $1
That's approx AUS $1.30 gross profit per pound and they announced that the number of pounds is 143.2 million.

Again, in my opinion, the cashflow, profit and drilling upside potential looks excellent to me.

From my initial research, it (Redbank) also appears to be situated in a Uranium zone (Westmoreland (approx 40kms from NT/QLD border on QLD side) is nearby, as well as a few others)


Constructive comments & discussion please.
I hold bks
Always seek professional investment advice before investing & please read below.